Despite rosy sales forecasts, U.S. retailers are facing major challenges as they head into the holiday season.
Retail executives are not only dealing with a strained global supply chain, but are also feeling growing pressure from consumers to improve the treatment of employees, according to findings of a research study from Accenture.
The study, based on parallel surveys of more than 1,500 consumers and 120 U.S. retail executives, found that 49% of retail executives feel increased pressure to provide career growth opportunities for their employees, and 51% feel pressure to offer permanent roles to holiday-season temporary workers.
In addition, 47% of the executives also report that the holiday season is making process training and culture and ethos training even more challenging for them.
The report noted that the findings are not tied to the holiday period, as the vast majority of surveyed executives said that during the pandemic, they felt pressure to improve their treatment of employees (cited by 71%); to improve the inclusivity of their store environments and the diversity of their workforce (83%); and to improve their company culture and public image (82%).
“In today’s challenging retail labor market — not just during the holidays but beyond — retailers must ensure that their employees have the skills and opportunities to thrive, as well as the resources to find the right balance between their home and work lives,” said Jill Standish, a senior managing director at Accenture who leads its Retail industry group globally.
In response, many retailers are taking a different approach to recruitment this year:
48% have altered/enhanced hiring processes to onboard new recruits faster;
38% have altered/enhanced their training processes to make it faster and easier for their recruits to become work-ready; and
34% are changing role descriptions to target and attract different types of candidates.
“The well-being of employees is now also top of mind for consumers, who will favor companies able to show consideration for the ‘human’ side of the workforce,” Standish added. To succeed in recruiting during peak times and in building a workplace that is better for everyone — workers, customers and their own businesses — retailers will need to bring a flexible, inclusive and digitally enabled approach.”
Supply Chain Retail executives are also taking steps to address the ongoing disruption caused by the pandemic and events such as the Suez Canal blockage. According to the findings, 99% of the executives said that they have done something differently this year to ensure supply of stock, while 52% said they’ve taken extraordinary steps to do so.
The research also revealed that 34% of consumers overall — and 52% of younger millennials — are worried about stock availability and not being able to buy what they want and need for the holidays, and — perhaps not surprisingly — the same number (34%) said they plan to do their holiday shopping earlier this year.
Also, 36% of consumers said that they have noticed empty shelves when shopping in-store. And 26% said they have noticed more out of stocks this year when shopping online.
“Order fulfillment and securing stock will be one of the biggest challenges during the holiday season, while many brands could find themselves short-staffed over the peak period, likely leading to longer lines, emptier shelves—and therefore greater customer frustration,” said Jill Standish, a senior managing director at Accenture who leads its Retail industry group globally. “Retailers need to scale up their scenario planning so that they can model for the unpredictability of cross-border delays and the impacts of rising costs on margins and retail prices. This also involves analyzing stock inventory management data to develop different models to respond to spikes in demand and mitigate against expensive out-of-stock scenarios.”
All retail executives survey respondents work at the vice president level or above (42% CEO, 38% SVP or EVP, and 21% VP) for retail companies with annual revenues of at least US$1 billion. Approximately half (53%) have revenues between $1 billion and $5 billion; 32% have revenues between $5 billion and $20 billion. The remainder (15%) have revenues greater than $20 billion.